Tamil Nadu

South Chennai

143/2007

m/s.Saravana Insulators Ltd - Complainant(s)

Versus

United India Insurance Company Ltd - Opp.Party(s)

K.Moorthy

01 Sep 2015

ORDER

                                                                         Date of Filing :  27.03.2007

                                                                        Date of Order :  01.09.2015.

DISTRICT CONSUMER DISPUTE REDRESSAL FORUM, CHENNAI(SOUTH)

     2^nd Floor, Frazer Bridge Road, V.O.C.Nagar, Park Town, Chennai-3

 

PRESENT: THIRU. B. RAMALINGAM M.A.M.L.,                      : PRESIDENT

                 TMT. K.AMALA, M.A.L.L.B.,                                   : MEMBER I

                 TR. T.PAUL RAJASEKARAN, M.A PGDHRDI, AIII,BCS : MEMBER II

 

                            C.C.NO.143/2007

TUESDAY THIS 1^ST  DAY OF SEPTEMBER 2015

 

M/s. Saravana Global Ltd.,

Rep. by its Authorized Signatory &

Mr. Pankaj Bethala V.P.,

Having Office at Swathi Club,

Penthouse Opp. Andhra Club,

New No.43, Veijayaraghava Road,

T.Nagar, Chennai.                                         ..Complainant

 

                                                 ..Vs..

 

1.  United India Insurance Company Limited,

Head & Registered Office,

Whites Road,

Royapettah,

Chennai – 14.

 

2. United India Insurance Company Limited,

Divisional Office,

No.13-A Nethaji Road, Ist Floor,

Cuddalore 607 302.                                        .. Opposite parties.

 

For the Complainant            :  M/s.  Surana & Surana        

 

For the Opposite parties       :  M/s. M.B. Gopalan & others.    

 

 

        This complaint is being filed by the complainant u/s 12 of the C.P. Act 1986 for a direction to the opposite parties to pay a sum of Rs.12,13,599/- towards the insured value of the consignment and Rs.2,67,723/- as interest  and also to pay a sum of Rs.2,00,000/- for mental agony and damages  with cost of the proceedings to the complainant.      

ORDER

 

THIRU. B. RAMALINGAM PRESIDENT        

 

         

1.The case of the complainant is briefly as follows:-

        The complainant is being business of manufacturing Insulators and other electrical power equipments having factory at P.N. Kuppam, Kunijipadi Post, Cuddalore.  The complainant has obtained  Marine Cargo Inland Transit Insurance Open policy from the opposite parties for their products to transport from his factory to anywhere in India at the E.B. sites.  The liability of the opposite party was limited to Rs.10,00,000/- at the beginning but to try the relevant the limit was enhanced to  Rs.21,00,000/- and transporting area is covered the E.P. sport in all over India.   The sum assured as per the policy is Rs.1,75,00,000/-.  The said insurance policy was subject to surrender condition attached with the policy and the cover note containing the following condition and warranty i.e. each and every dispatch of the goods to be declared to the opposite party within 48 hours.   On 30.3.2005 the complainant dispatched the consignment for the value of  Rs.19,64,209/- which was sold and to be delivered to Grid Corporation of Orissa Limited, Orissa to their works sport Sub-Divisional office Transmission through vehicle  bearing No. AP 37V / 4284 belongs to Andhra Bangalore Roadways Pvt. Limited.  The said vehicle was met with an accident Near Melvaruthur, Tindivanam.  On the intimation of the same the opposite parties have appointed surveyor Mr. Nawab John  for preliminary assessment and subsequently deputed M/s. Selva & Selva I-Tech Chennai for final survey report.  The claim for the said damage / loss of goods in the accident was submitted by the complainant to the opposite parties on 7.4.2005 with necessary document.

        The opposite parties have not settled the claim as per the policy but on the basis of the survey report has repudiated the claim by sending letter dated 26.9.2005 stating that the consignment which was lost in the accident it was sent to the consignee premises was not E.B. site  but sent to the Grid Corporation of Orissa, Orissa.   Though the said consignment desptached on 30.3.2005 was met with an accident the declaration for the same was made on  31.3.2005 after the vehicle had met with an accident.  On verification of the dispatch statement  they came to know that the some of the earlier consignment were undeclared for Insurance and the cumulative value of dispatches from 31.1.2005 to 30.3.2005 is Rs.3,65,76,992/- whereas the policy is taken for Rs.1,75,000/- and hence the policy expires by exhausting the declarations ought to have been made by the Insured on 16.2.2005 itself.  Hence this declared transit  is not held covered under this policy.  According to the complainant the said reason stated for the repudiation of the claim by the opposite parties are not sustainable.  Since the said consignment was sent to the working sport of the Electrical Sub-station for the account of Grid Corporation of Orissa, Orissa.   Further the earlier consignments which were said to have been not declared to the insurer were sold and  transported at the risk of the consignee / purchaser.  As such those consignments the complainant has not insurable interest.  Therefore they were not declared to the insurer and which will not be the valid ground for rejection of the complaint mentioned claim which were duly declared within 48 hours from the time of dispatch of the goods from the factory.  Therefore the opposite parties insurance company has not settled the claim in time after submission of all the documents.   As such the opposite parties have  committed deficiency of service in not settling the claim to the complainant.   Hence the complaint.     

3.      Written version of   opposite parties  are  as follows:-

It denies all the averments and allegation contained in the complaint except those that are specifically admitted herein.    It is true that the complainant had availed a Marine Open policy No.012400/21/04/00149 covering all their transits of electrical insulators to various electricity boards throughout India for a sum insured of Rs.1,75,00,000/- for the period 31.1.2005 to 30.1.2006.  The relationship between the parties was governed by the terms and conditions of policy of insurance.  The complainant was obliged to declare each and every consignment sent in transit and pay the requisite premium to cover the risk.   The insurer would be liable only upon compliance with such conditions by the complainant and there being a valid contract of insurance enforceable as on date of cause of action.  In this claim the complainant had submitted a declaration on 31.3.2005 at 10.00 a.m. by facts in respect of transit of Electrical Insulators commencing its transit from 30.3.2005 itself, sent to Grid Corporation of Orissa through vehicle No.AP-37-B_4284 dated 30.3.2005 for a declared amount of Rs.19,64,209/-.   While so on 31.3.2005 the same date on which declaration was made, intimation of accident near Melmaravuthur for the vehicle  was reported by the complainant.  The insurer promptly appointed a licence independent surveyor Mr. Nawab John for preliminary survey and also appointed M/s. Selva & Selva I-Tech Chennai for final survey.    The consignment was found to have been dispatched on 30.3.2005 itself.  But the declaration was made on 31.3.2005, on which date itself the accident is said to have taken place.   The surveyor / insurers have verified and found that the complainant had not declared each and every consignment but was selective in its declaration, which constituted gross breach of the terms and conditions of policy of insurance.  Such selective declaration is a gross violation of the contract of insurance and any claim.  The complainant has committed gross violation of terms and conditions of the Open Marine Policy and as such there was no valid declaration on 31.3.2005 and the insurer was not on risk on 31.3.2005 as there was no valid and effective contract of insurance to be enforced against this insurer.   Hence there is no deficiency of service on the part of the opposite parties.   Therefore the complaint deserves to be dismissed.   

4.   Complainant has filed his Proof affidavit and  Ex.A1 to Ex.A15 were marked on the side of the complainant.    Opposite parties have filed their proof affidavit and Ex.B1 series  was marked on the side of the opposite parties.  

5.         The points that arise for consideration are as follows:-

1.    Whether there is any deficiency in service on the part of the opposite parties ?

 

2. To what relief the complainant is entitled to?

 

6. POINTS 1 & 2 :

         Perused the complaint filed by the complainant, written version filed by the opposite parties,  the  proof  affidavit filed by both sides and Ex.A1 to Ex.A15 filed on the side of the complainant and Ex.B1  filed on the side of the  opposite parties and considered both side arguments.   7.     There is no disputes between the parties that the complainant is doing business of manufacturing Insulators and other electrical power equipments having factory at P.N. Kuppam, Kunijipadi Post, Cuddalore.  The complainant has obtained  Marine Cargo Inland Transit Insurance Open policy from the opposite parties for their products to transport from his factory to anywhere in India at the E.B. sites.  The liability of the opposite party was limited to Rs.10,00,000/- at the beginning but subsequently the limit was enhanced to  Rs.21,00,000/- and transporting area is covered the E.P. sport in all over India as per Ex.A3.  The sum assured as per the policy is Rs.1,75,00,000/-.  The said insurance policy was subject to surrender condition attached with the policy and the cover note containing the following condition and warranty i.e. each and every despatch of the goods to be declared to the opposite party within 48 hours.   On 30.3.2005 the complainant dispatched the consignment for the value of  Rs.19,64,209/- which was sold and to be delivered to Grid Corporation of Orissa Limited, Orissa to their works sport Sub-Divisional office Transmission trough vehicle  bearing No. AP 37V / 4284 belongs Andhra Bangalore Roadways Pvt. Limited.  The said vehicle was met with an accident Near Melvaruthur, Tindivanam.  On the intimation of the same the opposite party has appointed surveyor Mr. Nawab John  for preliminary assessment and subsequently deputed M/s. Selva & Selva I-Tech Chennai for final survey report.  The claim for the said damage / loss of goods in the accident was submitted by the complainant to the opposite parties on 7.4.2005 with necessary document i.e. Ex.A4.

8.     Whereas the complainant has raised grievance that in respect of the claim made the opposite parties have not settled the claim as per the policy but on the basis of the survey report has repudiated the claim by sending letter Ex.A9, dated 26.9.2005 stating that the consignment which was lost in the accident it was sent to the consignee premises was not E.B. site  but sent to the Grid Corporation of Orissa, Orissa.   Though the said consignment dispatched on 30.3.2005 was met with an accident the declaration for the same  was made on  31.3.2005 after the vehicle had met with an accident.  On verification of the dispatch statement  they came to know that the some of the earlier consignment were undeclared for Insurance and the cumulative value of dispatches from 31.1.2005 to 30.3.2005 is Rs.3,65,76,992/- whereas the policy is taken for Rs.1,75,000/- and hence the policy expires by exhausting the declarations ought to have been made by the Insured on 16.2.2005 itself.  Hence this declared transit is not hled covered under this policy.  According to the complainant the said reason stated for the repudiation of the claim by the opposite parties are not sustainable.  Since the said consignment was sent to the working sport of the Electrical Sub-station for the account of Grid Corporation of Orissa, Orissa.   Further the earlier consignments which were said to have been not declared to the insurer were sold and  transported at the risk of the consignee / purchaser.  As such  those consignment the complainant has not insurable interest.  Therefore they were not declared to the insurer and which will not be the valid ground for rejection of the complaint mentioned claim which were duly declared within 48 hours from the time of dispatch of the goods from the factory.  Therefore according to the complainant the above stated reason by the opposite party in their letter Ex.A9, dated 26.9.2005  for repudiation of the claim made by the complainant are all not valid.  As such the opposite party  has committed deficiency of service in not settling the claim to the complainant and liable for the reimbursement of the loss of goods in the accident as per the policy with interest with compensation as claimed in the complaint.

9.     Among the said reasons mentioned by the opposite partite in their letter Ex.A9, dated 26.9.2005 the one of the reason stated that for repudiation of the claim that the said consignment under the claim was sent not to the E.B. sport but to Grid Corporation of Orissa, Orissa is not acceptable as mentioned by the complainant, since the said Grid Corporation of Orissa, Orissa is the  Department of Electricity Board engaged by the Orissa State Government and further as per the lorry receipt filed by the complainant the said goods / consignment was sent to deliver at Sub-Divisional Office, Orissa.   Therefore the said reason for repudiation of the claim by the opposite party is not sustainable and acceptable.  

10.    However the other reasons stated by the opposite parties for repudiation of the claim that the early consignment dispatched from the complainant factory form 31.1.2005 to 30.3.2005 which is for the total value of Rs.3,65,76,992/- was not properly declared to the insurer / opposite parties by the complainant as per the terms and conditions of the said policy and according to the same the said dispatched of consignment value which exceeds the sum assured of Rs.1,75,00,000/-.  As such the complainant has committed violation of terms and conditions and claim made for the consignment is also exceeds and not covered under the policy as such the opposite parties / insurer is not liable to settle the claim to the complainant is acceptable.  Contrary to this, though the complainant has accepted that they have dispatched consignments from the factory during the period from 31.1.2005 to 30.3.2005 for value of Rs.3,65,76,992/- as per the survey report mentioned document, the contention made by the complainant side in respect of the same that the said earlier consignments were transported from the factory on the risk of the consigner / purchaser, as such in respect of those consignment the complainant not having no insurable interest, therefore the non declaration of those consignment  the insurer / opposite parties is not amount to breach or violation of terms and conditions is not acceptable. 

11.    Further as submitted by the learned counsel appearing for the opposite parties that  the claim of the complainant could not be considered  as the complainant had violated the condition of the policy by not disclosing each and every consignment before it left the complainant ‘s factory premises since it is the said basic condition of the policy and on its breach the liability of the respondent stood repudiated is proper and acceptable.   It is also pertinent to note that  as contended by the opposite party the claim made under the policy is also exceeding the limit of coverage of the said policy i.e. Rs.1,75,00,000/- at the relevant time of dispatch of loss of the said consignment.   Therefore the said claim is not covered under the said policy is also acceptable.  Therefore in support of their case the opposite parties referred decision of Hon’ble Supreme Court of India rendered in the case

SURAJ MAL RAM NIWAS OILS MILLS (P.) LTD.,

..VS..

UNITED INDIA INSURANCE COMPANY & ANR.

Published in IV (2010) CPJ 38  (SC)

is also squarely applicable for the facts and circumstances of the present case. 

12.    Therefore we are of the considered view that since the complainant had committed violation of the terms and conditions i.e. not declared each and every dispatch of the consignment from the factory to the opposite parties during the period from 31.1.2005 to 30.3.2005 and the claim made for the loss of consignment mentioned in the compliant is also exceed limit of coverage of the said policy, the opposite parties are not liable to settle the claim as claimed by the complainant and the repudiation in this regard by the opposite parties to settle the said claim on the above  said ground is valid and reasonable and acceptable.   Therefore  the deficiency of service attributed by the complainant against the opposite parties in the complaint is not sustainable,  as such the complainant is not entitled for any relief sought for in the complaint  against opposite parties and the complaint is liable to be dismissed.  Considering the facts and circumstances parties have to bear their own cost of litigation and as such the points 1 & 2 are decided accordingly.

        In the result this complaint is dismissed. No costs.         

 Dictated to the Assistant transcribed and typed by her corrected and pronounced by us on this  1^st    day of September  2015.

 

MEMBER-I                                         MEMBER-II                                           PRESIDENT.

Complainant’s Side documents :

Ex.A1-  31.1.2005     - Copy of Marine Insurance Policy.

Ex.A2-  31.1.2005     - Copy of receipt

Ex.A3 – 31.3.2005    - Copy of Declaration details.

Ex.A4-  7.4.2005       - Copy of Marine claim.

Ex.A5- 11.4.2005      - Copy of letter from Andra Bangalore Roadways Ltd.,

                               With damaged certificate.

Ex.A6- 11.4.2005      - Copy of letter from the complainant to the Insurance Surveyor.

Ex.A7- 27.6.2005      - Copy of letter from Selva and Selva to the complainant.

Ex.A8- 2.7.2005        - Copy of letter to Selva and Selva from the complainant with

                               certificate   

Ex.A9- 26.9.2005      - Copy of communication from the opposite party repudiating the

                               Claim.

Ex.A10- 24.11.2005   - Copy of letter from complainant to opposite party.

Ex.A11- 12.12.2005   - Copy of letter from the complainant to opposite party.

Ex.A12- 12.1.2006    - Copy of letter from the complainant to opposite party.

Ex.A13- 11.1.2007    - Copy of chartered Accountant’s certificate certifying the damages.

Ex.A14- 13.1.2007    - Copy of profile of Grid Corporation of Orissa Limited

Ex.A15- 26.2.2007    - Copy of Board resolution.

 

Opposite parties’ side documents: -    

 

Ex.B1-                    -        - Copy of Marine Open Policy.

 

 

 

MEMBER-I                                          MEMBER-II                                         PRESIDENT.